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Quadfurcation of Market

 


Yes, the title is giving directional clues towards ‘Market Segmentation’, the most important part while making a marketing strategy. Market Segmentation determines how the organization, on the basis of age, income, personality, or behavior has divided its consumers. These segments can be used later to optimize products and promotions for different consumers. Market segmentation at its core is the practice where it divides the target audiences into approachable groups. It generates market subsets based on the demographics, needs, priorities, common concerns, and other psychographic/behavioral criteria that are used to better understand the target audience. You can leverage the product, sales, and marketing strategies by understanding these market subsets. Creating marketing communications using both traditional and digital platforms, the segmentation will allow to improve responses and reduce buying costs. These segments can also boost the development cycles of products by providing information on how and when to create product offers for different demographic sections. Companies that segment their market properly enjoy significant benefits.

Types of Market Segmentation -

Through segmentation and market research, one can understand how the market will respond to a certain situation, such as purchasing products. In many cases, a predictive model can be included in the study, to group individuals into segments based on answers to survey questions.

  1. Geographic Segmentation -

Though it is the subset of demographics, it is typically the easiest, as it segments consumer target groups on the basis of geographical boundaries. Due to the different needs, preferences, and interests of potential consumers, understanding the climates and geographical regions of consumer groups can help to determine where to sell and advertise, and where to expand the business.

  1. Demographic Segmentation -

It basically includes segmentation of consumer target groups based on age, education, income, family size, race, gender, occupation, nationality, etc. It is one of the most common and simplest forms of segmentation since products and services are often based on demographics, how we use them, and how much we are willing to invest in them.

  1. Psychographic Segmentation -

The Psychographic Segmentation of the consumer is taken into account by dividing markets into lifestyle, AIO (Activity, Interest, Opinion). Large markets such as fitness, use psychographic segments when they categorize their consumers as the people who care for good health.

  1. Behavioral Segmentation -

Behavioral Segmentation is most useful for the e-commerce industry as they can track the behavior of the consumer with:

●      Browsing

●      Expenditure

●      Purchasing

●      Brand Loyalty

●      Ratings of Products

(How to) Start?

●      Conduct Primary Research

●      Determine “How To” segment your market

●      Design your study

●      Create segments

●      Test and Evaluate

After determining the segments, it should be ensured that they are useful. For the same, they should be analyzed on the parameters of Measurability, Accessibility, Actionability, and Substantiality.

The segmentation of the market is not an exact science. As you go through this process, it may be realized that behavior-based segmentation does not allow it to operate. To make sure you have found the best match for your marketing, sales, and product companies, you will want to draw on your findings.

 


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